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By Ethan Wolff-Mann
June 7, 2016
AT&T Data Cap
Roberto Machado Noa—LightRocket/Getty Images

AT&T and other internet providers have begun subtly implementing data caps—for home, wired use, not on LTE. The constrictions are irritating consumers, who potentially have to spend more money for less. For cell phone plans, which largely moved away from unlimited data a few years ago, capped service is the standard and consumers expect it. It makes sense when you think about it; there are so many people using a relatively small number of towers, and wireless transmission means limitations.

But unlike your phone, your cable internet is wired. In fact, you can see the wires everywhere, hanging on utility poles. There, fiber optic cables can transfer data incredibly quickly, making internet data caps a harder a pill to swallow.

It turns out your gut is probably right. There's very little basis to support the notion that there's a scarcity in internet bandwidth—it's even something the chief executives of communications carriers readily admit, as TechDirt recently noted.

Dane Jasper, CEO of Sonic, a California-based internet provider, told CIO that "The cost of increasing [broadband] capacity has declined much faster than the increase in data traffic." Additionally, he noted that the company's costs for supporting broadband had dropped from 20% of revenue to 1.5% in the past few years.

Other CEOs have said the same. After noting the declining costs of technology to support high-speed data, Frontier Communications CEO Dan McCarthy told trade publication Fierce Telecom, "There may be a time when usage-based pricing is the right solution for the market, but I really don't see that as a path the market is taking at this point in time."

But wait—there's more!

The most damning piece of evidence against the capping model—which is essentially taking a step back and providing less, technology-wise—is from the CEO of a company that had a cap and abandoned it when it was clear that it wasn't necessary.

According to St. Louis broadband company Suddenlink CEO Jerry Kent, companies don't have to spend a lot to keep up with customers' data demands. "Those days are basically over," he said on an investor call last year, "and you are seeing significant free cash flow generated from the cable operators as our capital expenditures continue to come down."

By Daniel Bortz
March 13, 2021
House roof is touching two stacks for money piles.
Kiersten Essenpreis for Money

If you’re thinking about refinancing your home loan, consider switching to a new mortgage lender.

“Lender allegiance can backfire if you don’t shop around to see if there are better rates,” says Heather McRae, a senior loan officer at Chicago Financial Services. That’s especially true in today’s refi market, where lenders are aggressively competing to woo customers.

According to a Black Knight report, lender retention is at an all-time low. Mortgage servicers (read: the company that collects your mortgage payment) retained just 18% of the estimated 2.8 million homeowners who refinanced in the fourth quarter of 2020, the lowest share on record.

Here are the benefits and drawbacks of changing lenders when you refinance your mortgage.

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Pro: You may snag a better mortgage rate

It never hurts to shop around, says David Mele, president of Homes.com. “A lot of borrowers stay with their lender when refinancing because they’re familiar with them, but you always want to compare quotes to make sure you’re getting the best deal,” says Mele. “If your account is in good standing, you may be able to get the lowest refi rate with your current lender, but different lenders have different lending requirements.”

However, you don’t have to talk to every lender in town. McRae suggests getting quotes from three lenders when surveying your options. “I talked to [a refinancer] recently who spoke to 11 different mortgage lenders and that’s just totally unnecessary,” she says. “You’re not going to get dramatically different offers by going to a ton of lenders.”

If your current loan servicer issues mortgage refis (some don’t), McRae recommends getting a quote from them — but be prepared to provide a healthy stack of paperwork. “A lot of people falsely believe the application process is easier if they stay with their loan servicer, but in general you’re going to have to provide the same information and documentation to your servicer that you would to a new lender,” she says.

Con: You don’t know how a new lender treats its customers

If you’ve developed a good relationship with your lender, that’s no small thing. “Having someone you trust with your money is invaluable, and your home is probably the largest investment you have, so you want to make sure you have confidence in the lender that you’re working with,” says Todd Sheinin, chief operating officer at Homespire Mortgage in Gaithersburg, Md. “Some lenders treat their clients better than others.”

Reflect on your experience with your current lender. Sheinin recommends considering questions like: “Were you kept informed of everything that was happening with your mortgage? Do you feel like you had your loan officer’s full attention? Did you get a great rate? Has your lender kept in touch?”

Having a responsive lender is especially important when things go wrong — say, if you need help applying for mortgage forbearance(borrowers with government-backed FHA loans, VA loans or USDA loans can enroll in forbearance plans, which puts their mortgage payments on pause, through June 30) or need a loan modification.

Pro: You may get lower closing costs

Closing fees for refinancing typically cost 2% to 5% of your new loan amount — on a $300,000 balance, that’s $6,000 to $15,000, since some lenders charge higher fees for home appraisals, title searches, and other services. Therefore, a different lender may offer you lower closing costs than your original lender.

That being said, some lenders “will be willing to give a current and good client a discount on closing costs to keep them as a client,” Sheinin says. Depending on the lender, they could offer a reduction of a few hundred dollars to about $1,000 in lower closing fees.

One caveat: “I always tell people to be cautious when a lender offers a ‘credit’ to cover some or all of the closing costs,” McRae says. “That almost always means a lower interest rate was available.”

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Con: You may get slapped with a prepayment penalty

Although prepayment penalties have become less common, some lenders still charge borrowers a fee for paying their mortgage off before their loan term ends. Prepayment penalty costs can vary widely. Some lenders charge customers a percentage (usually 2% to 3%) of their outstanding principal, while others calculate prepayment fees based on how much interest the borrower would pay on their loan for a certain number of months (typically six months).

Look for the term “prepayment disclosure” in your mortgage agreement to see if your lender charges a prepayment penalty and, if so, how much it costs.

The bottom line

You’re not required to refinance with your original lender, but whether it makes sense to switch to a different one depends on your priorities as well as what rate and terms you can qualify for with a new lender. Need a little help whittling down your options? Check out Money’s list of Best Mortgage Refinance Companies of 2021.

More from Money:

6 Instances Where Refinancing Your Mortgage Could Actually Cost You Money

7 Easy Tips for Refinancing Your Mortgage While Rates Are Still Low

Procrastinators, It's Not Too Late to Refinance Your Mortgage and Save Thousands